Omnichannel map

What is Omnichannel and Why Should I Care?

Posted in Trends & Technologies and tagged , , , , , , , , , .

The social network is (one of) your sales channels.  Map of Facebook connections; by Michael Coghlan, CC license

“Omnichannel” commerce describes the (new) reality of being able (are you able?) to sell and deliver your goods and services to anyone, anywhere, at any time.  Not just sell, but carry the selling experience to the consumer in your own unique way.  Selling your goods through Amazon is not selling in a true B2C sense, because you don’t control the buying environment and buying experience; your stuff is on their site just like everyone else’s; all you have to do is ship the order.

And not just deliver, but completely fulfill your customer’s order in a virtual and physical sense, including returns, adjustments, credits, coupon discounts, and loyalty discounts, stuff that your current systems are probably unprepared to manage.

Consider an example:  You are a name brand manufacturer of sporting goods.  Before “omnichannel,” you sold through distributors to sporting goods retailers or directly to big box discount outlets or department stores. Your go-to-market path and the systems you needed were relatively simple.

Now, in an omnichannel world, your customers want to buy your products on Amazon, e-Bay or any number of sites, or directly from your web site delivered by Fedex, directly from you delivered to your local department store, or from inside the store but delivered to your home.  They want to use an online coupon in the store or a store coupon to buy online. They want to return everything at no cost and with no hassle.

The main point: your customers still want your goods, but the mechanics of selling to them and satisfying them have changed dramatically, requiring a whole new set of enterprise software tools.  Author and adviser Geoffrey Moore calls these tools systems of engagement, and clearly distinguishes them from the traditional systems of record most enterprises are used to.  In omnichannel, you need both, and engagement systems must work hand in hand with systems of record.

This is the value (some) e-commerce firms provide.  One of them is SPS Commerce, a small but successful company based in Minneapolis.  Other traditional EDI providers like GXS/OpenText, IBM Sterling, and SAP/Crossgate are also competing in this space, and the race to “own” omnichannel is on.

My advice:

  • Your legacy ERP systems won’t get you there; you need commerce-capable systems of engagement;
  • There is a lot of hype around omnichannel and therefore many vendors claiming they have the best solutions; look for years of experience in multi-channel fulfillment;
  • Pick a small pilot project with narrow scope; get e-commerce vendors to let you try-and-buy;
  • For a larger project such as outsourcing B2C, use a structured RFP process and compare vendors in an apples-to-apples way;
  • Straight-on EDI services have become a commodity, so look for vendors that can give you other omnichannel capabilities such POS analytics and data integration, digital product and image catalogs, or configurable B2C sales platforms; or e-commerce vendors who already have a large percentage of your customers and suppliers already in their network.
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